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Crown Van Gelder N.V. Velsen

Crown Van Gelder N.V. Velsen. Half year figures 2007. Presentation 27 July 2007. Agenda 27 July 2007. Opening Highlights HY1/07 Key figures Distribution of sales Financial Results HY1/07 Strategic Issues Results and outlook European paper companies

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Crown Van Gelder N.V. Velsen

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  1. Crown Van Gelder N.V. Velsen Half year figures 2007 Presentation 27 July 2007

  2. Agenda 27 July 2007 • Opening • Highlights HY1/07 • Key figures • Distribution of sales • Financial Results HY1/07 • Strategic Issues • Results and outlook European paper companies • Assumptions and outlook CVG for HY2/07 • Q&A’s

  3. Highlights HY1/07 • Net profit EUR 0.7 million, down EUR 0.3 mln on 2006 • Sales volume increase of 2.8% to 104,200 ton • Production volume up by 1.8% to 105,400 ton • Costs increase of raw materials and energy continues • Selling price increase of 4% insufficient to offset higher input costs • Strong emphasis on cost reductions and investment level • Restructuring of European Paper industry in line with expectations

  4. Key figures 2004-2007

  5. Production and Sales Volume CVG Geographical spread 10% 13% Outside Europe Netherlands 8% Other EU 16% France 16% Belgium/Luxembourg 22% 15% Germany United Kingdom

  6. WF Uncoated Order Stocks and Deliveries Reels

  7. Financial Results HY1/07

  8. NBSK Price Development Source: FOEX/PIX-index

  9. Hardwood Price Development Source: FOEX/PIX-index

  10. Consolidated Profit and Loss Account (EUR x 1.000) (unaudited)

  11. Result Analysis 2007 vs. 2006

  12. Result analysis 2007 vs 2006

  13. Consolidated Balance Sheet (before profit appropriation) (EUR x 1.000) (unaudited)

  14. Cash Flow Statement (EUR x 1.000) (unaudited)

  15. Strategic Issues

  16. Transfer of industry (source: Nordea)

  17. China clearly driving global capacity growth Source: Pöyry

  18. China’s annual additions • Strong capacity increase in China, reductions elsewhere • High requirement for waste papers • Increase in pulp capacities will catch up with stronger demand Source: Tembec and * NLK Associates

  19. The challenge by 2020 EU Energy Policy 2020 • EU and Member states have set the following targets: • A minimum of 20% reduction of CO2 by 2020 compared to 1990. Possibly extended to 30% if all developed countries participate post 2012. • A 20% energy efficiency target by 2020 compared to a Business as usual scenario. • A 20% renewable energy target of all energy use. • A 10% bio fuel in transport fuel mix.

  20. The challenge by 2020 from 6% to 20% RES 20% 20% 6% 6% Solid biomass is critical to meet the target! Source: VNP

  21. The challenge by 2020

  22. The challenge by 2020 Paper industry as the enabler • Our industry has an unique position: • It is competitive and sustainable (50% of energy consumption based on biomass). • Existing procurement system to handle large volumes of biomass (25% of EU RES used in forest based industry). • Energy generation infrastructure in place. • Highest heat and power efficiency in use (85-90%). • Expertise, knowledge and infrastructure.

  23. Impact on strategy CVG • Executing Mission Statement 2010 • Implementing Energy Transition / Mitigating energy profile • Development of specialties (NBD) for niche markets

  24. Results and outlook European paper companies

  25. ROCE Comparison CVG and Peer Group

  26. Outlook • StoraEnso Board: “The outlook for fine paper demand and prices remains healthy, and steady growth in demand is anticipated, except for the seasonal slowdown due to summer holidays. Looking ahead for the rest of this year we anticipate further fibre cost increases” • UPM-Kymmene Board: “In Europe, demand for printing papers is forecast to grow slightly from the corresponding quarter last year, while in North-America demand is expected to decrease. Cost pressures from wood fibre and the strengthened euro are new challenges for the industry.”

  27. Outlook • M-Real Board: “The demand for office paper and packaging paperboard, as well as their price development is expected to remain good in the third quarter of 2007. M-Real has announced price increases for coated and uncoated fine paper in the autumn. No relief in production input costs is in sight. Under current conditions, the full-year cost increases in 2007 are expected to slightly exceed the positive impact of profitability improvement programmes.”

  28. Announced capacity closures

  29. Data Nordea

  30. Outlook Deutsche Bank

  31. Assumptions and outlook for HY2/07 • Assumptions • Further cost pushes from raw materials likely • Selling price increases from Q4 onwards • Further European capacity reduction in 2007/2008 • Outlook • Production and sales volume around 215,000 ton • Improvement of Net Result in HY2/07 versus HY1/07

  32. Meeting 27 July 2007 Q&A’s

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